Exit beckons for boss of troubled Bear Stearns

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Cayne, who was paid more than $38 million (£l9.2 million) last year, was notable for his absence at the start of the subprime crisis last summer. While Bear Stearns had to close two failed hedge funds and write down $1.9 billion, Cayne ousted his co-president and heir apparent Warren Spector and spent much of his time golfing and at a bridge tournament in Nashville, Tennessee.

His departure from the top slot would follow those of Charles "Chuck" Prince from Citigroup and Merrill Lynch's Stan O'Neal, both forced out in the wake of huge subprime writedowns.

Bear Stearns, known for its fixedincome work while most other investment banks tend to concentrate on dealmaking, had been planning massive expansion, particularly in London. A year ago, it agreed to take more than 200,000 square feet of a new office being built in Canary Wharf. The bank was reportedly looking to recruit up to 2000 new staff in London.

Cayne, 73, said he and his co-directors would not receive a bonus in 2007, but he last month sold shares worth $15.4 million. He still owns a 5% stake in the bank, whose shares fell 53% last year.

His successor will almost certainly be Alan Schwartz, 57, who joined Bear Stearns in 1976 after injury prevented him becoming a professional baseball player with the Cincinnati Reds.

He will take charge as the American economy moves into recession. David Rosenberg, chief US economist at Merrill Lynch, has said a wave of economic data, weakening employment and falling retail sales mean the US is already in recession. "This isn't even a forecast any more but a reality, he added.

Merrill chief executive John Thain is expected to recruit former Goldman Sachs head of securities Thomas Montag. Insiders said that Montag, who resigned from Goldman last month, will lead Merrill's global markets division, overseeing equity trading and the fixed-income unit.

Thain, himself an ex-Goldman president, inherited the helm of Merrill late last year after $8 billion of writedowns on mortgage-related assets.